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tv   Mad Money  CNBC  February 24, 2010 12:00pm-12:30pm EST

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when all we need is a simple operating loan or equipment loan as we have before? what is the answer? what i can tell them besides we've invited you to come out to our district to talk to them personally and individually would perhaps help the banks out. >> well, part of the issue here is of course, there is more than one regulator and if next time please ask who the regulator is. if it's federal reserve, i would like to hear from you and i would be happy to talk to you about it. we at the federal reserve are -- we understand, we should all understand that we don't want banks to make bad loans. if a borrower is not financially able to manage the loan, but you're talking about situations where you say the borrower is credit worthy. in that situation we want the bank to make the loan, and i would answer to a number of questions about steps we've taken to gather more information, to have -- meetings and to train our examiners to focus this exact point.
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so we are very, very focused on trying to keep balanced. >> i know, but it's simply not getting through. it's not your fault and i don't think it's the fault of the regulators either because everybody is skittish because of the economy, but the problem is we're at the beginning of a real recovery, not make-up jobs with the dumb stimulus bill and not creating government jobs, but the creation of real jobs, of people in manufacturing going back to work and exported and many of these are highly paid union jobs that can't get the money and they're credit worthy. it doesn't make sense for us to have all this debt, all these programs. people ready to go and they're credit worthy and they can't get the product to create job. i would be happy to hear more details and i'll try to figure out what's going on because we are working very hard to make sure that's not the case in banks that we supervise. >> is it possible, chairman, that you could meet personally
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with some of these people? >> certainly, i'll take you up that. >> thank you, sir. >> the committee will number recess. i intend to come back with the third vote. any member wants to ask questions and if they're here, we'll call on them. hey, i'm cramer. we have a lot of stuff going on today. this is "mad money high noon." we've been listening all morning to ben bernanke's testimony. they're taking a break and we're monitoring it and return to it if need be. let's go to steve liesman. what do you think is happening here? >> the main thing to note is the thing he said again that the fed will remain exceptionally low for an extended period. there were questions about given what happened to the discount rate and given a very confusing financing program that they announced yesterday which is sort of a drain on liquidity.
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the main thing is bernanke steps forward and says we will remain exceptional, there are a lot of games and dancing going on about regulatory reform and games and dancing going on about some of the fed anger and the populist anger about where you go from here on deficits and that, but i don't think any of that is as substantial, jimmy, as the chairman saying here's the policy. the policy is what it was in january. one other note i would make, i thought his comments on the recovery were tentative and more on the one hand and on the other hand he's talking about this transition from a kind of government-fueled growth and an inventory fueled growth to a private sector growth that looks like it's under way, but he wasn't all that firm about it. >> as always, you've encapsulated it perfectly. it is not easy and he speaks more clearly than greenspan, doesn't he? >> it is easier to understand. i don't think he's holding back on anything. he's been very, very transparent, essentially to the fed's detriment to a point when
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it comes to these plans they have to tighten policy down the road and really, if you watch it, jim, he's walking a tightrope between we'll stay easing out and we're preparing for the tightening and here's the stuff to do that. so it's very tough to listen to his stuff. he did mention that he thinks the discount rise was ultimately successful in that there was no other tightening in the markets. ultimately, if i had to say on a scale of one to ten, with ten being more dovish and one being about what we expected, it's about a two or three. you saw the bond market rally a bit. the dollar didn't like it quite as much and more dovish than expected, but pretty much in line. >> think all of the viewers want to know the continuity. yesterday we had consumer confidence and this morning you pick up the wall street journal and the headline is banks aren't lending. do these actually affect the testimony? does he re-write it when he sees the headlines? no, i don't think so. i think he might have been spooked or unnerved by the jobless claim trend that has been out there.
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we sure want that to clarify a little bit. i don't think he rerights it for that and the housing has been disappointed. we've had a few bad jobs we had a couple of bad economic indicator which got people nervous. people think the recovery is intact, but it looks like it's taken a breather here. what do you make of the fact that this man's patience. there was a discussion back and north with representative waters and you might know about the discount, and this man doesn't know how to lose his temper and maxine waters and ron paul as well. ron paul asked about the federal reserve sort of laundering watergate money and funneling money to saddam hussein and bernanke was -- he was as close to losing his patience that i've ever seen, and he said that's bizarre and i've never heard anything about what you said to me. he doesn't get ruffled easily and he's been a model of
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patience with the questions out there. maxine waters on the issue of mortgage rates the question is what do you expect to happen to mortgage rates when you stop buying them at the end of quarter and not about the discount rate. >> one of the things i found discourage asking if you caught everything that representative waters said there was one moment where she said look, i watch a lot of tv. i hear a lot of things. if we were watching you we would know the crucial thing is what happens and when will that mortgage buy program end and that's what brings mortgage rates up? >> right. bernanke was very, very firm, jim. no connection between the discount rate and which by the w way, only $15 million was out in the market top ginn with and the mortgage market is a multitrillion market. they're gaining a system through some form of osh traj with the discount wind owe to begin with and there's no impact at all on the 25 basis points rise in the discount rate and what's happening in the mortgage market right now and marx een waters
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eventually got that and so i think bernanke ultimately with patience got his point across. >> anything you felt that was different from barney frank who was the crucial figure in all of this reform that we're talking about? >> yeah. i'm not hearing too much from barney frank. barney knows what position he's in. he knows that he'll have to take whatever can be agreed in the senate so barney has kind of laid-back a little bit and you did notice that he talked about having the gse reform conference on march 2nd, but interestingly, the affairs of state because of a fishing hearing he could not have the gse hearing. i will tell you that, jim, that will be the next most interesting thing to happen while we continue to monitor what's happening in the senate when it comes to regulatory reform and then try to see if the house and barney can live with the senate compromise. >> i found it interesting also. i like your take on this. >> ben bernanke is immune, what do you think about the goldman
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sachs bonus? what do you think about the idea that the banks are bad? i felt that it was very neutral and what they're doing is identifying bernanke as a good actor in what is a bad process. >> yeah, you know, i would say overall it sounds like given that the idea of bernanke being reconfirm side behind us now, some of the edge is off some of the questions that are out there. ron paul and maxine waters i think are too two extremes. i thought the gentleman from illinois and the republican was really interesting. i have a lot of manufacturers. they can't get credit and what can you do? i might point out bernanke was not strong in that regard. this idea and the front page in the journal today about the crash and lending from the fdic report and i think the fed has to be more firm about what's it going to take and how the fed could be an instrument and they've taken some actions and it's been lukewarm. >> i think you're right. i think he punted and that's why i'm hoping he would adjust the script because it's right in
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your face, the graph from 1990 and what turns it. you're right, the congressman had it more on point than ben bernanke. that's what it's all about. it's the companies that want to do business and can't get basic loans to do it. the idea that credit is still tight after all this time now. the history shows it takes a couple of years to get out of this, but you would think there could be something more that could be done. they have the program and they're running that in june so we'll see, but so far it's been responsive of the private sector and the kick-start lending has been very muted. >> steve, thank you for the fabulous rundown on a very important testimony. thank you. >> when i step back i still talk about whether ben bernanke punted on a particular issue about lending, but you know what? i'm a stock guy, and i see what happened in the stock market with dollar and gold. the stock market says can we now take a moment to praise ben bern
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anky? the fed chairman has one agenda and it's to keep rates low enough to stimulate economic activity so people can get jobs and that was on display all day today. by the way, i think when you see that testimony you have to come to the conclusion that bern anky is not just a student of politics. he's a student of history. he knows that most of the awful things that have happened in the past, not just in our country, but mostly in europe, the depressions, the unrest and even the wars have been caused at least in part by a government or many governments stifling of economic activity and not knowing what to do with the big layoffs and he is not going to be a stifler. he is not going to talk about health care or cap ask trade or the need to unionize, all of that hurts the cause of job creation and he's doing his part and you hear it in his testimony. i hear it in his voice. the man's the real deal and in
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his daily gloomfest that discounts everything positive, the companies are saying and they are saying a lot of good things. he is the only reason i can see that people are buying and not selling stocks in what i thought would be a down day before the testimony began. in fact, i think that we would all have to radically change our stock asset allocations if somehow we lost this man as our fed chairman right now. i join the congressman, and the congress people in congratulating him on his new term. there are simply so many other better countries to invest in and there's so much less political interfere wens growth in asia, latin america and even in africa as we know from the international oil and gas ceos who prefer hunting for crude in places like gabon, the drilling on any coast of the united states. even with the fabulous fed chairman whom i dedicated my book back, we're still recommending you keep 20% of your net work in foreign stocks
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and 10% in gold which i will try to explore more later on in the day. bernanke keeping doing his job, cry thely, firmly, whether it was giving an interview in 60 minutes and saying he was not going to nationalize the banks and that was less than a year ago. he had to beat back the academic assault on capitalism or be in his testimony today when he knows the job growth is meager and home buying is a drag on the system and the bank can't lend or people aren't applying for loans and it is a price to earnings multiple enhancer. he keeps us in the stock game. i can't believe he didn't lose his patience today as the federal funds rate and the impact on variable mortgagees onner lack thereof. is bernanke a miracle man? no. he can't counteract the administration and congress' obsession with jobs. can he fix the toyota accelerator? maybe. most important, though, he deserves our praise because
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without him our economy and our markets would be in much worse shape. i'm surprised he lives in washington, d.c. he's way too good for that town. let's take a look at how bernanke's testimony impacted the market this morning. brian shactman is down at the new york stock exchange. brian, what do you see happening right now? >> it's interesting. first of all, the stock market held up pretty well during the entire part of the testimony and it seems like there's appetite and tech and financials leading wait and utilities is the only down sector in the s&p and look at citi. there was a story in "the wall street journal" they might unload the hedge fund unit and we have napes like aig and suntrust doing well today. i also want to touch on tech and we had ca that made an acquisition in the cowed computing space with names like texas instruments and amd doing very well today. i don't want to be debbie downer two days in a row, but i want to talk about the housing sector because toll brother his interesting things to say that
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were somewhat positive. he said the last couple of weeks things were much better and we had mortgage apps and new home sales with a record low and they're pricing us off and inventories are creeping up and a lot of traders weren't focused on bernardino anky. >> they're giving away foreclosed hopes and it is disappoint to see applications down for mortgages. we had a big december and as bob dole would tell you and i love talking to bob, this is not the selling season. this isn't when people buy homes. i think we'll see much bigger numbers come the spring. one last point. how about the fact that the stock market drops during the intermission. we can take it over to 110, right? >> we were up over 100. the theme is still pretty intact and we're 20 points or so from erasing all of yesterday and we'll see what happens. >> mr. shactman, thank you so much. >> let's head over to the nasdaq with bertha coombs. bertha, we're seeing a bid in some of the tech stocks today. you know how much we talk about
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apple. >> bernanke said that one of the areas that we are seeing activity is that businesses are buying technology and it's really the case with autodesk. i do a lot of automation software. they had a great quarter and nice outlook and they're the best perfo forformer on the nas0 and the s&p. this is the right economy to be doing that and dollar tree putting a nice quarter as well. the outlook is up over 10% and what's interesting today is garmin to me, jim, because they said they were raising their outlook and everyone is so worried about apple and google and how they'll eat these navigation devices and clocks. they said yes, our earnings are higher, but our margins are going to be lower. >> we recommend sell that stock last week ahead of this quarter. i feel good about that sale and i reiterate that we should do it. thank you very much, bertha. great to have you. "mad money high noon" will be right back. i told you i liked gold. we have the ceo of eagle mines
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we struggle all of the time on "mad money high noon" or otherwise, when you should own gold boullioun or whether you
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should own an actual gold stock, no matter what, 10% of your portfolio should be in gold. that's a balanced portfolio. at nico eagle had been the gold stock of choice. they stumbled a couple of quarters ago and disappointed us, but you know what? sean boyd, the ceo is a stand-up guy and now he's got something to talk about because the last quarter was pretty darn good. sean, welcome back to "mad money." >> nice to be back, jim. >> let's talk about the turn. the last time we had you on i was wavering because maybe your cash costs would be going up and you've always been a great growth stock. how being you turn so many different properties within a three-month period? >> well, we are in a mine-building phase, as grew know and we're in the early stages of commissioning several new mines at the same time and some of the issues that came up as we explained in the third quarter weren't related to that
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activity. it was unfortunate timing, so we saw, as you indicated, improvements in all of the operations which drove our cash costs down in the fourth quarter to $297 u.s. an ounce, and that was on the cost side and the growth is still intact. in fact, the fifth of those five new mines were commissioning now and we should be pouring the first gold out of that mine which will be our biggest goal mine before the end of this mine. >> this is in the meadow lands? >> this is in the canadian -- >> i googled the darn thing, okay? and boy it seemed pretty far north and it just worries me. this is not some area where you just go up there with a pick and shovels, right? >> you're right. what you need to do is put in your infrastructure and unlike most arctic mines, we're not reliant on an ice road. we built our own road from the
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town and built our own airstrip and more importantly for us as a growing company is the base of our company is really in the province of quebec, but what we've done is we've created superintendent ort base for the arctic operation. we put it in quebec, near the three quebec mines and that's allowed us to share personnel and to share overhead and admin. >> sean boyd at agneco eagle mines, thanks for coming on "mad money high noon." good to see you, sir. >> good to be back. >> i wish we had more to say about gold because gold is so, so exciting to me, and the stocks, and i've got to tell you, the price of gold right now, i think it could waiver. i think you should stick with us at 6:00 p.m. on "mad money" because we're going to have more about gold. they're still on the break. "mad money high noon" will be right back.
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host: does charlie daniels play a mean fiddle? ♪ fiddle music charlie:hat's how you do it son. vo: geico. 15 minutes could save you 15% or more on car insurance. i've been on just a virtual crusade to promote the virtues of natural gas as a bridge fuel,
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one 30% cleaner than coal any to break the depend owns foreign oil and create hundreds of thousands of jobs. we want congress to get behind natural gas, but i think the coal lobby has too much heft and the president favors pretty much every energy source, but natural gas, and i'm just talking about his speeches and he likes nukes which may be real clean and not so good for cars. he also, the president thinks coal can be made clean and therefore we can use batteries in cars which plug into a coal-based system. there are people fighting for natural gas in washington and one is a democrat from colorado. if you want to understand this market, you need to understand congress. that's why i'm thrilled to have senator mark udall on the show today. thank you for coming on the show. >> thanks for having me on. i came on in part because cnbc has been covering the olympics, curling, the sliding sports and i've got it tol you, being on your show is like being on a bobsled run than curling. >> thank you so much. >> that means we've got it going
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and that's exciting to me. senator, am i paranoid or do i feel that the administration and perhaps some in congress are just unwilling to even address the notion that natural gas uld be a crucial fuel for this country? >> jim, your voice has been important. there are strong lobes her s t you point out. you talk about the carbon footprint that it doesn't have. there are a bipartisan group of us that are supporting t. boone pickens and the pickens act and there's movement here and there's momentum. we need to take advantage of this and the remarkable research with natural gas and thanks for what you're doing. >> i have a $100 bet with boone pick ins and he said something will materialize with the 18-wheeler segment by memorial day. i know you're onboard pt 18 wheeler. could you describe to our viewers how important this one truck bit of legislation could be?
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is. >> i would tell you i wouldn't double down on the 100 buck, but in the long run maybe you can rejiggle your deal with t. boone because i know we'll get a energy gas title in a big energy bill because it's obvious. it's clear to all of us here, at least i should speak for a group of us that this is an enormous opportunity for us with the new finds with the marcelus and the shales and i'm bullish on natural gas just like you are. >> senator, are you quietly building a coalation that we don't see? the reason i say that is because we were having trouble finding members of the senate who were willing to come up to discuss the issue. >> i know you were looking for waldo and i don't know if i'm a good replacement for him and this is one senator standing in front of you along with a number of others, that you're right, quietly. natural gas is a key part of the future and by the way, it will be a key part of the future with countries around the world because the shale plays are rampant. they're everywhere. that's the good news. >> totally agree.
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thank you, senator udall of colorado, and you're terrific to have. look forward to it and keep driving the bobsled and it's my best sport. okay. better than curling. "mad money high noon" will ob tonight at 6:00 p.m. on cnbc. we're coming back and we'll have more of senator udall because this is just too important. meanwhile, "mad money high noon" will be right back. aflaaac! our little friend here has spent ten years trying to get your attention. but, some of you still don't know quack about... aflac! so, give me ten seconds to fill you in. if you get sick or hurt, aflac pays you cash, fast to help pay for things major medical insurance doesn't. like car payments, mortgage and more.
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